Mr Money Moustache… the Australian Version!

Redwing · 16th Jan, 2023

Someone played around with Mr Money Moustache's numbers and converted them to AUD$

Fire-forum

“How Money Moustache retired in 10 years - Australianised version"

In this post I convert the history of MMM's savings and investments into 2021 Australian dollars, using US inflation rate data and the current AU to USD exchange rate of 0.72 USD to 1 AUD. I assume all figures exclude Super, since this is not very relevant.
Click to expand...

Original journey here:

[https://www.mrmoneymustache.com/201...-saved-from-zero-to-retirement-in-ten-years/)

AUD 2021 synopsis.

Year 0 -1 condensed (late 1997 - 98)

Pete graduates in Comp Sci and takes a grad role for $98k a year. Within his first year he receives a pay-rise to $135,000 a year, and saves $10,000.

Year 2, 1999

Pete saves about 30% of his gross income, continues to earn 135k a year, and now has 53k invested.

Year 3, 2000

Pete changes employers and now earns $171,000 AUD, 2 years into his career. Here he starts getting real serious, and saves 57% of his gross income. He now has \~149k accrued. He does this while living in Boulder, Colorado, a city with the cost of living pressures of perhaps Hobart.

Year 4, 2001

Pete job hops and now makes $180,000 a year, + his employer matches 5k of his investments, making his real salary closer to $191,000 a year.

At this point he claims to have accrued \~$325k along with his wife, a number which is highly suspect despite his high income, given the dot com bubble has just busted wide open, 9/11 has happened. Let's give him the benefit of the doubt and assume his wife came to the relationship with significant savings.

Year 4, 2002

Pete earns $224,000 a year including investment matching, while his wife makes \~130k, parlaying this into $185k in investment value growth.

Year 5 - 10, 2003 onwards

Pete goes into cruise mode, never takes another significant payrise (though gets some bonuses), he and his wife continue to save \~60% of their gross income, retirement by year 10 with \~$1.4m in assets. $1.4m may seem slightly low for a couple, but as he continues to work on various for-profit projects post-retirement (not least of which is his blog), it isn't as shaky a foundation as it might seem.

My take

Reading the blog, you would think riding a bicycle instead of driving a car was key to early retirement. Despite all the lectures on savings, Pete starts out for the first few years being a terrible to mediocre saver, and only gets good in the last 5 - 6 years before he retires. In fact he spends most his path to early retirement driving an expensive car, as part of a two car couple.

The real lesson here isn't to eat rice and beans, it's to graduate into a field where you can quickly make $200,000 a year, while living in a low cost of living region.

If you can do that and keep your spending to a moderate level, you can easily retire very early, all without the culty nonsense.”
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Piston_Broke · 16th Jan, 2023

You'd think I'd written this answer...though I'm a little more uhm subtle
"TLDR: Earn $200k/yr, save 80% post tax income by living in a low cost area and being super frugal. Court someone in a similar position, meaning you could collectively be saving $230k/yr!"

A rich older wife with strong money is definetly a FIRE plan.
Though onlyfans creators can also work in the short term these days.

Terry_w · 16th Jan, 2023

**My take**

Reading the blog, you would think riding a bicycle instead of driving a car was key to early retirement. Despite all the lectures on savings, Pete starts out for the first few years being a terrible to mediocre saver, and only gets good in the last 5 - 6 years before he retires. In fact he spends most his path to early retirement driving an expensive car, as part of a two car couple.

The real lesson here isn't to eat rice and beans, it's to graduate into a field where you can quickly make $200,000 a year, while living in a low cost of living region.

If you can do that and keep your spending to a moderate level, you can easily retire very early, all without the culty nonsense.”
Click to expand...

Interesting!

Andrew Allen · 16th Jan, 2023

Seems like in the US there are many markets where you have an affordable cost of living and reasonable housing prices. So you can effectively do the geo-arbitrage game very well there if you can earn a tech salary and live outside of the expensive cities. Also I think you can get tax advantages on income tax by moving that aren't available here.

So getting to a million+ in net worth by primarily savings without relying on capital growth or investment returns, seems like it's a valid approach for those with the required discipline.

I'm a fan of MMM, he's also keen on real estate.

Piston_Broke · 16th Jan, 2023

Andrew Allen said: ↑

Seems like in the US there are many markets where you have an affordable cost of living and reasonable housing prices.
Click to expand...

People here can do it with no qualifications whatsoever.
Move to Perth or NQld and get a laborer job or drive a truck in the mining industry.
Earn 150k per yr, spend 50k and you'll have 1m in 10 yrs.
Or better buy IPs or invest along the way. Learn a trade, make more.
Anyone doing this would've done a lot better in any 10 yr period than that.

And if you'd want to be trained for free, join the army.

Do people really need mmm to work this out...and of course no specifics as most get rich stories go.
He really made the money from the blog affiliate links though.

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Mr Money Moustache… the Australian Version!

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Mr Money Moustache… the Australian Version!

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